Acorn Unveils Blockchain-based Crowdfunding Platform

2/5/2018 8:17 AM ET

Acorn Collective Limited is building a new Ethereum blockchain based crowdfunding platform, which would be the first platform to be free and open to any legal project in any country, mainly for those living in developing countries.

The company in its white paper said it will issue a new ERC-20 standard token called OAK on the Ethereum blockchain. OAKs will be distributed in return for ETH contributions. The pre-sale funding target is $5 million, and main initial coin offering or ICO target is $50 million with a stretch goal of $100 million. The minimum funding threshold for the Main ICO is $5 million.

The company noted that ERC-20 token means tiny transaction fees, compared to 3-5% fees typically for other crowdfunding platforms. Acorn noted that it does not need to charge any platform fees for crowdfunding as ICO proceeds fund its Revenue Generation Mechanisms. Meanwhile, other platforms typically charge 5%, it said.

By using blockchain for transactions, the company said it can eradicate most transaction fees, with only minimal Ethereum network fees.

Acorn noted that it will provide a crowdfunding hub, a secondary marketplace to sell post-crowdfunding goods & services, a point-of-sale payments app, as well as the Acorn token, OAK.

"We'll allow legal and non-harmful projects, irregardless of category to crowdfund for free. Acorn works as well for community projects as it does for huge consumer products. We don't shut you out because you're a local business," the company said.

Crowdfunding, the concept of raising many small contributions through an online funding platform, has been highly appreciated for the role it plays for talented entrepreneurs seeking business funding, who may otherwise lack finance or partnerships.

Crowdfunding first appeared in the early 2000s. In its white paper, Acorn noted that it was only after the launch of Indiegogo in 2008 and Kickstarter in 2009 that crowdfunding gained considerable traction. Kickstarter, since its founding till August 2017, has channelled over $3.2 billion from more than 13 million backers to fund almost 130,000 projects.

Indiegogo has raised more than $1 billion in funding. In terms of ICOs, over $3 billion was raised in 2017 alone, as of November.

Acorn's ICO pre-sale has been officially announced for launch on Monday January 29 and will have been running through to Friday February 19.